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[no audio] >> good evening from the magness

.reana i welcome you to the first presidential debate between president barack obama and the republican nominee mitt romney. this debate in the next three are sponsored by the commission on presidential debates. tonight's 90 minutes will be about domestic issues and will follow a format designed by the commission. there will be 615-minute segments with two-minute answers for the first question then open discussion for the remainder of the segment. thousands of people offered suggestions on questions via the internet and other means. i made the final selections. they were not submitted for approval to the commission or

the candidates. the segments will be free on the economy and one each on health care, the role of garment, and governing. there will be an emphasis throughout on differences, specifics, and choices. both will have two-minute closing statements. the audience has promised to remain silent. no cheers, applause, or other noisy distracting things so we may concentrate on what the candidates have to say. there is a noise exception right now as we welcome president obama and governor romney. [applause]

welcome to you both. let's start with the economy. segment one. let's begin with drops. what are -- let's begin with jobs. what are the major differences between the two of you about how you would go about creating new jobs? you have two minutes each to start. the coin toss has determined that mr. president goes first. >> thank you very much for this opportunity. thank you, governor romney, and the university of denver. 20 years ago i became the luckiest man on earth because michelle obama agreed to marry me. i want to wish you happy

anniversary and let you know that a year from now we will not be celebrating it in front of 40 million people. four years ago, we went through the worst financial crisis since the great depression. millions of jobs were lost. the auto industry was on the brink of collapse. the financial system froze up. because of the resilience in the termination of the american people, we have begun to fight our way back. we have seen hide million jobs in the private sector created. the auto industry has come back. housing has begun to rise. we have a lot of work to do. the question here is not where we have been but where we are going. governor romney has a perspective that says if we cut taxes skew toward the wealthy and roll back regulations we will be better off.

i have a different view. we have to invest in education and training. it is important to develop new sources of and in america, change our tax code to help small businesses and companies investing in the united states. that we take some of the money that we are seeing -- saving to robo-call america -- rebuild america. it will be up to the voters was path we should take. will we double down on the top- down economic policies that helped get us into this mess or embrace a new economic patriotism that says america does best when the middle class does best. i will forward to having that debate. >> it is in honor to be here with you. i appreciate the chance to be with the president. congratulations to you mr.

president on your anniversary. i am sure this is the most romantic place you could imagines here with me. congratulations. this is a tender topic. i have met people across the country. i was in dayton, ohio and a woman said i have been out of work since may. can you help me? yesterday was a rally in denver. a woman with a baby said, my husband has had four jobs in three years -- part-time jobs. he lost his recent job. we lost our home. can you help us? yes, we can. it will take a different path, not the one we have been on. not the one the president describes as a top down cut taxes for the rich. my plan has five parts -- did us not american energy independent to create 4 million jobs.

open up trade in latin america. crackdown in china if they cheat. make sure people have the skills to succeed in the best schools in the world. give us to a balanced budget. champion small business. it is small business that creates jobs in america. over the last four years, small business people decided america may not be the place to open a new business because a new business start-ups are down to a 30-year low. i know what it takes to hire people. i am concern that the path we are on is unsuccessful. the president has a view very similar to what he had four years ago that a bigger government spending more, taxing more. trickle-down government would work. that is not the right answer for america. i will restore the vitality that it america working again. >> please respond directly to

the trickle-down approach. >> let me talk about what i think we need to do. we have to improve our education system. we have made enormous progress drawing on ideas from democrats and republicans. they are starting to show gains in some of the toughest to deal with schools. we have a program called race to the top that has prompted reforms in 46 states, raising standards, improving how we train teachers. i want to hire another 100,000 new math and science teachers and create 2 million more slots in our community colleges serve people can get trained for the jobs that are out there. i want to make sure we keep tuition low for our young people. when it comes to our tax code, we agree that our corporate tax rate is too high. i want to lower its part to

curley for manufacturing. -- especially for manufacturing. i want to close loopholes that are giving incentives for companies shipping jobs overseas. i want to give tax breaks for companies investing in the united states on an empty. we agree we have to boost american energy production and oil and natural gas production have been higher than they have been in years. we have to look at the energy source of the future like wind, solar, and biofuels and make those investments. all of this is possible. we have to close our deficit. we will discuss how we deal with our tax code and how we make sure we are reducing spending in a response away and have enough revenue to make those investments. centerr romney's economic plan calls for a $5 trillion tax cut on top of the extension of the bush tax cut.

to try and dollars in additional military spending. -- $two trillion in additional military spending. without dumping the cost on the middle class americans. that is one of the central questions of this campaign. >> you have spoken about a lot of different things. governor romney, do you have a question you would like to ask the question directly about something he just said? >> i do not have a $-- tax cuts bill you're talking about. we have to provide tax relief to people in the middle class. our not reduce the share of taxes paid by high income people. they are doing fine in the economy. the people who are having a ha time are middle income americans. under the president's policies,

they have been buried. middle income americans have seen their income decreased by $4,300. this is a tax and itself -- the economy tax. gasoline prices have doubled under the president, electric rates are up, food prices are up, health care costs have gone up by $2,500 per family. the question is how to get them going again. it is energy and trade. the right kind of trading programs. -- training programs. the present mission of those ideas. education. it is key. it is the future of our economy. we have 47 training company -- programs. they are reporting to eight agencies. we have to get those dollars back to the states and go to the workers so they can create their

pathways into training they need for jobs that will help them. taxation. we should bring the tax rates down. for corporations and individuals. for us not to lose revenue, i lowered deductions and credits and intentions so we keep taking in the same money when you account for growth. energy is critical. the president pointed out that production of oil and gas in the u.s. is up but not due to his policies. in spite of his policies. all of the increase in natural gas and oil has happened on private land, not in government land. your administration has cut the number of permits and licenses in half. if i am present, i will double them. i will get the oil from off store -- offshore and alaska. i like coal. people in the coal industry feel like it is getting crushed by

your policies. i want to get america and north american energy independence so we can create jobs. i am not looking to cut massive taxes and reduce the revenues going into the government. my number one principle is that there will be no tax cut that adds to the deficit. no tax cut that adds to the deficit. i want to reduce the burden being paid by middle income americans. i cannot reduce the burden pared by-income americans. any language of the country is not accurate. >> us talk about taxes. it is instructive. four years ago when i stood on the stage, i said that i would cut taxes for middle-class families. that is what i did. we cut taxes for middle-class families by about $3,600.

we do best when the middle class is doing well. by giving them those tax cuts, they have a little more money in their pockets so they can buy a new car. they are in a better position to weather the recession we went through. they can buy a computer for their kid who goes to college, which means they spend more money, businesses make more profits and hire more. governor romney's proposal that he has promoted for 18 months trillion cut. he is saying he will pay for it by closing loopholes and deductions. he has spent asked how he would close those loopholes and deductions. he has not been able to identify them. when you add up all the loopholes and deductions, that upper-income individuals are

taking advantage of, to close all away. you do not come close to paying for $5 trillion. that is why independent studies looking at this said the only way to meet governor romney's pledge of not reducing the deficit or not adding to the deficit is by burdening middle- class families. they would pay about $2,000 more. that is not my analysis. that is the analysis of the economists. that kind of top down economics where people at the top are doing well while middle-class families are burdened further, that is not what i believe is a recipe for economic growth. >> what is the difference? let's say on taxes for a moment. >> everything he said about my

tax plan is inaccurate. if the tax plan he described for a tax plan i we're going to support, i would say no. i will not put in place a tax cut that as to the deficit. that is part one. no economist can say mitt romney's tax plan at $5 trillion. i will not reduce the share paid by high-income individuals. you keep saying that. it is not the case. i have five boys. i am use to people saying something that is not always true and hoping i will believe it. that is not the case. i will not reduce the taxes paid by high-income americans. i will not raise taxes on middle-income families. i will lower taxes for middle- income families. there are studies that looked at

the studies to describe and say it is wrong. a study said he will raise taxes by $3,000 or $4,000. i want to bring down rates. lower deductions and exemptions and so forth. so we keep getting the revenue we need. small business pace that individual right. 54% of america's workers work in businesses that are taxed at the individual tax rate. if we lower that rate, they will be able to hire more people. this is about jobs. >> do you challenge with the governor said about his plan to attack for 18 months he has been running on this tax plan. now, he is saying that his idea is never mind.

if you are lowering the rates the way you described, it is not possible to come up with enough deductions that only affect high-income individuals to avoid raising the deficit or burdening the middle class. to dematha. it is arithmetic. governor romney and i do share a deep interest in encouraging small business growth. while my tax plan has been lowering taxes for 98% of families, i lowered taxes for small businesses 18 times. i want to continue the tax rates we put into place for small businesses and families. for incomes over $202,000 per year, we should go back to the rate we had when bill clinton was present when we created 23

million new jobs. we created a lot of millionaires. by doing that we can not only reduce the deficit, we can not only encourage job growth through small businesses, but we can make the necessary investments in education and energy. we have a difference when it comes to definitions of small business. under my plan, 97% of small businesses when not see their income taxes go up. governor romney says those top three% would be burdened. under governor romney's definition, there are millionaires and businesses who are small businesses. donald trump is a small business. he does not like to think of himself as small anything. that is how you define small- business. that kind of approach will not grow our economy because the

only way to pay for it without burdening the middle class or blowing up our deficit is to make drastic cuts in things like education, making sure that we are investing in basic science and research. everything that is helping america grow. that would be a mistake. >> just for the record -- we are over our first 15 minutes. we are still on the economy. we will come back to taxes. we will move on to the deficit. >> mr. president, you are right. 97% of the businesses are not taxed at the 35% business rate. those businesses in the last three% employee -- 3% employee

half of the people who work in small business. they have employed one quarter of all the workers of america. you plan to take their rate from 35% to 40%. i talked to a guy with four employees. he said he and his son calculate how much they pay in tax. it added up to well over 50 per cent of what they earned. your plan is to take the tax rate of successful small businesses from 35% to 40%. the national federation of independent businesses says that will cost 700,000 jobs. i do not want to cost jobs. my priority is jobs. i bring down the tax rates, lower deductions and exemptions, the same b ideas theowles- simpson to create more jobs.

there is nothing better toward getting us to the balanced budget than having more people working, paying more taxes. that is the most efficient way to get this budget balanced. >> you may want to move on to another topic. if you believe we can cut taxes by $5 trillion, and at $2 trillion in additional spending, that the military is not asking for, $7 trillion -- over 10 years, that is more than our entire defense budget. you think that by closing loopholes and deductions for the well-to-do, you will not end up picking up the tab. governor romney's plan the work for you. math, common sense, and our history shows us that is not a recipe for job growth. we have tried both approaches.

the approach that governor romney is talking about is the same sales pitch that was made in 2001 and 2003. we ended up with the slowest job growth and 50 years. we ended up living from surplus to deficits. it culminated in the worst financial crisis since the great depression. bill clinton tried the approach i am talking about. we created 23 million new jobs, but from deficit to surplus, and businesses did well. in some ways we have some data on which approach is more likely to create jobs and opportunity for americans. i believe that the economy works best when middle-class families are getting tax breaks and those of us who have done well because of this magnificent country we live in that we can afford to do more to make sure we are not blowing up the deficit. >> he gets the first word of

that segment. let me make this comment. let me repeat what i said. i am not in favor of a $5 trillion tax cut. my plan is not to put in place any tax cut that will add to the deficit. that is not my plan. let's look at history. my plan is not like anything that has been tried before. my plan is to bring down rates and credit so the revenue stays in but we bring down rates to get more people working. my priority is putting people back to work in america. they are suffering. look at the evidence of the last four years. it is extraordinary. we have 23 million people out of work or have stopped looking for work. when the present -- president

took office, 47 million on food stamps. economic growth is slower than last year and last year's lower than the year before. going forward with the status quo will not cut it for the american people who are struggling. >> we are still on the economy. this is the second segment on the economy, specifically on what to do with the federal deficit. you each have two minutes. governor romney, you go first because the president when offers on segment one. what are the differences between the two of you as to how you would go about tackling the deficit problem in this country? >> it is a critical issue. it is not as an economic issue. it is a moral issue. it is not moral from my generation to keep spending more

than we take in knowing those burdens will be passed on to the next generation and they will pay the interest and principal. the amount of debt we are adding is not moral. how do we deal with it? there are three ways that you can cut a deficit. one is to raise taxes. another is to cut spending. number three is to grow the economy. if more people were, they are paying taxes. the president would prefer raising taxes. the problem is that it slows down the rate of growth. you can never quite get the job done. i want to lower spending and encourage economic growth. i will eliminate all programs by this test if they do not pass it. is the program so critical is it is worth barring china to pay for it? obamacare is on my list. i use the term with all respect.

i will get rid of that. i will stop the subsidy to pbs. i like pbs. i like big bird. i cannot keep spending money to borrow from china to pay for it. i will take programs that are good programs but will be run more officially at the state level. i'll make government more efficient and cut back the number of employees and combined some agencies. my cutbacks will be done through attrition. the president said he would cut the deficit in half. he doubled it. trillion dollar deficit for the last four years. the president has put in place almost as much debt held by the public as all prior presidents combined. >> when i walked into the oval office i had more than a trillion dollar deficit treating

me. we know where it came from. two were -- wars pay for on a credit card. those quote tax cuts that are not pay for. programs that were not paid for. a massive economic crisis. despite that, yes, we had to take some emergency measures to make sure we did not slip into a great depression. let's make sure we are cutting out things that are not helping us grow. sunday 7 government programs from aircraft that the air force ordered but were not working well. 18 government programs for education that were well- intentioned. they're not helping kids learn. we went after medical fraud in medicare and medicaid very aggressively. it saved tens of billions of dollars. i work with democrats and republicans to cut a trillion

dollars out of our discretionary domestic budget, the largest cut in the discretionary domestic budget since dwight eisenhower. we have to do more. i put forward a $-- $4 trillion reduction plan on a website. you can look at the numbers. what cuts we make and what revenue would -- we raise. $2.50 for every cut we ask for a dollar of additional revenue, paid for by asking those of us who have done well in this country to contribute more to reduce the deficit. romney mentioned the bowls- simpson commission. that is how the bipartisan commission suggested we do it. in a balanced way with some revenue and some spending cuts. this is a major difference that governor romney and i had. you are looking for contrast.

when governor romney stood on a stage with other republican candidates for the nomination, he was asked, "would you take $10 of spending cuts for just $1 of revenue?" he said no. if you take an unbalanced approach, that means you are going to be cutting our investment in schools and education. governor romney talk about medicaid and how we can send it back to the states. that means a 30% cut in the primary program we held for seniors in nursing homes, kids with disabilities. that is not a right strategy for us to move forward. >> what about some some goals -- simpsons-bowles? >> i have my own plans.

if you want to make adjustments, take it. go to congress and fight for it. >> that is what we have done. >> you have been present for four years. he said he would cut the deficit in half. we still have trillion dollar deficits. if you are reelected, we will get to a trillion dollar debt. you have said he will cut the deficit in half. you find $4 trillion in cuts. we still show trillion dollar deficit a year. that does not get the job done. why is it that i do not want to raise taxes? i do not want to raise taxes on people. in 2010, he said he would extend the tax policies we have now and not raise taxes because when the economy is going so like this, you should not raise taxes on anyone. the economy is still going slow.

it is growing more slowly now than when he made that statement. if he believed the same thing -- the reality is it is not as wealthy people. it is not just donald trump you are taxing. it is the people that employ 1 quart of the workers that are taxed as individuals. you raise taxes and kill jobs. that is why the national federation of independent businesses said your plan will kill 7000 jobs. >> but stay on the tax system for a moment. the deficit there has to be revenue in addition to cuts. >> governor romney has ruled out revenue. >> the revenue i get is by more people working, getting higher pay, pay more taxes.

that is how we get growth and balance the budget. the idea of taxing people more and putting people out of work -- you'll never get there. spain spends 42% of their total economy on government. we are now spending 42% of our economy on government. i want to go to the path of growth that the americans to work with more money coming in. >> you are saying to get the job done it has to be balanced. >> if we are serious, we have to take a balanced responsible approach. it is not just what it comes to individual taxes. let's talk about corporate taxes. i have identified areas where we can make a change that would help the economy. the oil industry gets $4 billion per year. in corporate welfare. they get deductions the small

businesses do not get. does anyone think exxon mobile need extra money when they make money every time you go to the pump? why wouldn't we want to eliminate? that? tax breaks for corporate jets? if you have a corporate jet, you can pay for a friend and not get a special break. when it comes to corporate taxes, governor romney has said he has won it two in a revenue neutral way close loopholes and deductions. that would bring down the corporate rate. i want to do the same thing. i have action identify how we can do that. part of the way is to not give tax breaks to companies shipping jobs overseas. you can take a deduction for moving a planned overseas. most americans would say, "that does not make -- or make sense.

if we take a balanced approach, that allows us to help young people make sure they can afford to go to college. the teacher i met in las vegas, who describes to me she has 42 kids and her class, the first two weeks, she has some of them sitting on the floor until they get reassigned. they're using textbooks that are 10 years old. that is not a recipe for growth. that is not how america was built. but it reflects choices. we will have to make decisions. if we are asking for no revenue, that means we have to get rid of a bunch of stuff in the magnitude of the tax cuts you're talking about would end up and severe hardship for people. it will not help us grow. when you talk about shifting

medicaid to states, we are talking about a potentially 30% cut. that may not seem like a big deal when it is numbers on a sheet of paper. if we are talking about a family with an autistic kid and depends on that medicaid, that is a big problem. governors are creative. they are not created a enough to make up for 30% of revenue on something like medicaid. some people end up not getting help. >> we have gone on a lot of topics. >> come back to medicaid. >> let's go through them one by one. the department of energy has said the tax break for all companies is $$2.2 billion per year. in one year, you provided and

$90 billion in breaks to the free energy world. i like green energy. that is about 50 years' worth of what oil and gas receives. this $2.8 billion goes to smaller companies. if we get that tax rate down to 25 per cent, that money is on the table. do not forget -- you put $90 billion into solar and wind solyndra and tesla. you pick the losers. this is not the kind of policy you want to have to get american energy secure. you said you get a deduction for taking a planned overseas. i have been in business for 25 years. i have no idea what you are

talking about. the idea you get a break for shipping jobs over the seas is not the case. medicare -- medicaid to states -- i would like to take the medicaid dollars to go to state and tell them they will get what they got last year plus inflation plus 1%. you were manager care for the poor in the way you think best. as a governor when this idea was floated by tommy thompson, the governors said, please, let us do that. we can care for our own for and more effective a way than having the federal government tell us how to care for our pork. one of the magnificent things about this country is the idea that states are the laboratories of democracy. do not let the government tell state what kind of training and

medicare they have to have. if the state gets in trouble, we can step in to help them. the right approach is one that relies on the brilliance of our people and states, not the federal government. >> we are still on the economy but another part of it. this is segment 3, the economy -- entitlements. the first question goes to you, mr. president. do you see a major difference between the two of you on it? >> we have a somewhat similar petition is a position. it is socially sound. it will have to be tweaked. the basic structure is sound. i want to talk about the values behind social security and medicare. medicare is the big driver of our deficit. my grandmother helped to raise

me. my grandfather died a while back. my grandfather -- grandmother died three days before i was elected president. she was independent. she works her way up. she only had a high school allocation. she ended up being the vice- president of a local bank. she ended up living by choice. she could be independent because of social security and medicare. she worked in her life, which records offer live, and understand there was a bow sick -- basic for under which she cannot go. the name entitlements' implies some sense of dependency on the part of these people. these are people who have worked hard. my approach is to say how do we strengthen the system of the long term? in medicare, what we did was we

said we are going to have to bring down the costs if we are one to deal with our long-term deficits. to do that, let's look at where some of the money is going. $716 billion we were able to save by no longer overpaying insurance companies and making sure we are not over paying providers and using that money we were able to lower prescription drug costs by an average of $600. we were able to make a significant debt and providing them the kind of preventive care that will save money barack the system. the way -- money door of the system. the way for us to do with medicare is to lower health-care costs. when it comes to social security, you do not need a major structural change to make sure it is therefore the future. >> we will follow up on this. you have two minutes on social security and entitlements. >> our seniors depend on these

programs. any time we talk about entitlements, people become concerned. neither the president nor i are proposing any changes for any current retirees or near- retirees either to social to carry or medicare. if you are 60 or older, you do not need to listen any further. for younger people we need to talk about what changes will occur. when i said the president is not proposing changes, he is for medicare. for medicare, for current retirees, he is cutting $700 -- money. everyone will get a low rate is not just going out the places where there is abuse. that is saying we are cutting the rates. hospitals and nursing homes say they will not take any medicare

patients. 50% of doctors say they will not take more medicare patients. we have 4 million people on medicare advantage that will lose medicare advantage because of those $716 billion in cuts. how can you cut medicare $700.16 -- some of the $16 billion for career reception -- recipients. you say you'll get a better prescription program. they know that is not a good trade. i want to take that money you have cut and put it back into medicare. we can include a prescription program. the idea of cutting $716 billion from medicare to balance the additional cost of obamacare is a mistake. with regards to young people, i have proposals to make sure medicare and social security are there for them. >> it is important for governor

romney to present this plan that will only affect people in the future. it will turn medicare into a voucher program. it is called premium support. it is understood to be a voucher program. >> you do not support that? >> i do not. >> that is for future people. >> if you are 54 years old, you may want to listen. this will affect you. the idea was originally presented by congressman ryan, you're running mate. we would get a voucher to seniors. they could go out in the private marketplace and buy their own health insurance. the problem is that because the voucher would not necessarily keep up with health care inflation, this would cost the average senior about $16,000 per year.

but governor romney has said is he will maintain traditional medicare alongside it. there is still a problem. those insurance companies are clever about figuring out to are the younger and healthier seniors. they recruit them, leaving the older, sicker seniors in medicare. every health care economist as overtime, the traditional medicare system will collapse. you have people like my grandmother at the mercy of the private insurance system when they are most in need of decent health care. i do not think vouchers are the right way to go. this is not my -- only my opinion. aarp thinks the savings we obtained from medicare bolstered the system, lincoln the medicare trust fund by eight years. benefits were not affected. if you repeal obamacare, the

simmons will be paying $600 more in prescription -- those seniors to pay $600 more in prescriptions. there will have to pay copays. the primary beneficiary of that repeal our insurance companies that are estimated to gain billions of dollars back when they are not making singers healthier. that is not the right approach when it comes to making sure that medicare is stronger over the long term. >> we will talk about health care in a moment. do you support the voucher system, governor? >> i support no change for current retirees and near- retirees to medicare. the present -- the president supports taking money out of that program. for people coming along that our young, is a better young, i

would allow them to choose the current medicare program or the private plan. it is their choice. they will have at least two plans that will be at no cost to them. they do not have to pay additional money. they will have ellis' two plans. if the government can be as efficient as the private sector and offer lower premiums, people will be happy to get traditional medicare or a private plan. i would rather have a private plan. i'm not like the government to tell me what kind of health care i would get. people make their own toys. to save medicare, we have to have the benefits high for those that are low income. for higher income people, we will have to lower the benefits. make sure the benefit is there for the long term. the idea came not from paul ryan for the co author critical of

the of the bill in the senate. it came from bill clinton's chief of staff. we canys let's see if get competition into the medicare world so people can get the choice of different plans at lower cost, better policy is a quality. i believe in competition. >> every study has shown matters here -- medicare has the word administrative cost. this is why seniors are generally happy with it. private insurers have to make a profit. that is what they do. you have higher administrative costs plus profit on top of that. if you were going to save any money to what governor romney is proposing, what has to happen is that the money has to come from somewhere. when you move to a voucher system, you are putting seniors at the mercy of those insurance

companies. over time, it traditional medicare has decayed, they are stuck. this is why aarp has said your plan would begin medicare substantially. that is why they were supportive of the approach we took. we do have to lower the cost of health care. >> we will talk about that in a minute. >> overall. quote that is a big topic. -- >> that is a big topic. >> let's get back to medicare. if that is the case, it will always be the best part people can purchase. the private sector is typically able to provide a better product at a lower cost. >> can you agree that voters have a choice on medicare and?

>> absolutely. >> to finish on the economy, what is your view about the level of federal regulation of the economy right now? is there too much? mr. president, should there be more? this is not in -- this is a two- minute segment to start. >> regulation is essential. you cannot have a free market work if you do not have regulation. i need to know the regulations. you cannot have people opening of things in their garage and making loans. you have to have regulations for an economy to work. regulation can become excessive. >> is it excessive now? where? >> in some places. with some of the legislation passed during the president's term, it has become excessive. it has hurt the economy.

for example, dr. frank -- dod rank -- dod -frank dissipates banks too big to fail. this is an enormous boon for new york banks. there have been 122 community and small banks have close since dodd-frank. >> you want to repeal dodd- frank? >> i would repel and replace it. there are some parts that make all of t sense in the world. in a transparency, the average once -- leverage lemons. --limits. >> of us to let him respond to this specific one dodd-frank. >> the reason we have been in

such an enormous economic crisis was prompted by a reckless behavior across the board. it was not just on wall street. you had loan offices getting loans and mortgages that should not have been given because the people did not qualify. people were borrowing money to buy houses they cannot afford. credit agencies where something these as a1 grade vestments. you have banks making money, turning out products that the bankers and not understand. in order to make big profits, knowing that it made the system vulnerable. what did we do? we stepped in. we have the toughest reforms on wall street since the 1913's. banks have to raise their capital requirements.

do not engage in risky behavior. make sure you have a living will so we can know how you will wind things down and make a bad bet so you do not have other taxpayer bailouts. we made sure all of the help we provided the banks was paid back with interest. governor romney has said he wants to repeal dodd-frank. i appreciate. we have agreement that a market place to work has to have regulation. he said he had wanted to repeal dodd-frank. does anyone think the big problem we had is that there was too much oversight and regulation of wall street? if you do, governor romney is your candidate. that is not what i believe. >> that is not the facts.

we have to have regulation on wall street. i would not designate five banks as too big to fail and give them a blank check. that is one of the unintended consequences of dodd-frank. we need to get rid of that provision. regional and small banks are getting hurt. you say we were giving mortgages to people who were not qualified. that is one of the reasons for the great financial calamity. dodd-frank says we need to have qualified mortgages or there are big penalties. they never defined what a qualified mortgages. it has been two years. we do not know what a qualified mortgage is. banks are reluctant to give loans. it did not anticipate putting in place the kinds of regulations you have to have.

sometimes they did not come off with clear regulation. i had to make sure that we do not hurt the functioning of our marketplace. i want to bring back housing and get good jobs. >> we have another clear difference between the two of you. let's move to health care, where there is a clear difference. that has to do with the affordable care act, or obamacare. it is a two-minute segment. two minutes each. governor romney, you want it repealed. why? >> it comes to my experience. i was in new hampshire. a woman said, i cannot afford insurance or myself or my son. i met a couple in wisconsin who said we are thinking about dropping our insurances. small businesses are dropping insurance because they cannot afford it. the cost is prohibitive.

we have to deal with cost. when you look at obamacare, the congressional budget office has said it will cost $2,500 per year more than traditional insurance. it is adding to costs. when the present ran for office, he said by this year he would have brought down the cost of insurance per family. it has gone up. it is expensive. expensive things hurt families. it cut $716 billion from medicare to pay for it. i want to put that money back into medicare. it put in place and unelected board that will tell people what kind of treatments they will have. i do not like that. there was a survey done of small businesses done. it said, what has been the effect of obamacare and you're hiring plans? three-quarters said it makes them less likely to high gear.

i do not know how the president can come into office facing 23 million out of work, rising unemployment, and economic crisis and spend his energy fighting for obamacare in set of jobs for the american people. it has killed jobs. the best course for health care is to do what we did in my state -- craft a plan at the state level that fits the needs of the state's. then focus on cost down for people. rather than raising its. >> the argument against repeal. >> four years ago, i was travelling around and having the same, stations. it did the same conversations. it was not just that small businesses were having cost skyrocket and they could not get affordable coverage or that this was the biggest driver of our federal deficit, it was

families who were worried about going bankrupt if they got sick. millions of families. they had a pre-existing condition. they may not be able to get coverage. if they did have coverage, insurance companies may impose an arbitrary limit. they are paying their premiums. someone gets sick. they do not have enough money to pay the bills because the insurance companies said they have hit the limit. we did work on this alongside working on jobs. this is part of making sure that middle-class families are secure. let me tell you what obamacare did -- if you have health insurance, it does not mean a government takeover. you keep your own insurance and your doctor. insurance companies cannot church your round. they cannot impose arbitrary lifetime limits. they have to let you keep your kid on your insurance plan until

they're 26 years old. it says that he will have to get a rebate if insurance companies are spending more on administrative costs and profits than they are with actual care. if you do not have health care -- health insurance, we are setting up a group plan that allows you to benefit from group rates that now, at the last. i would make -- >> your minute is up. >> i think i have five seconds before you interrupted me. [laughter] the irony is we have seen this model work well in massachusetts. gov. romney did a good thing to working with democrats in the state to set up what is

essentially the identical model. as a consequence people are covered there. it has not destroyed jobs. as a consequence we have a system where we have the opportunity to start bringing down costs instead of leaving millions of people out in the cold. >> year five seconds when a long way. until the president what you think what he just said is wrong. >> first of all, i like the way we did it in massachusetts. i like the way we had republicans and democrats come together and work together. what you did was push through a plan without a single republican vote. when massachusetts did something quite extraordinarily, elected a republican senator to stop obamacare, you pushed it through anyway. he pushed through something that

you and nancy pelosi and harry reid thought was the best answer and drove it through. what we did, 87% democrat, we worked together. 200 legislators, only two voted against it. we did not raise taxes. he raised the by $1 trillion. we did not cut medicare. we did not have medicare, but we did not cut it by $700 billion. we did not put together a board telling people what treatments they can receive. we put people in a position -- we did not put people in a position where they would lose the insurance they have an wanted. the cbo says up to 20 million people will leave -- lose their insurance. a study said 30% of them are anticipating dropping people from coverage. for those reasons, for the tax,

medicare, this board, and for people losing insurance, this is why the american people do not want obamacare. is why the republicans said do not do this. the republicans put out a bipartisan plan that was swept aside. i think something this big and important has to be done on a bipartisan basis. we have to have a president i can reach across the aisle with input from both parties. >> gov. romney says this has to be done on a bipartisan basis. this was a republican idea. gov. romney at the beginning of the debate said, what we did in massachusetts could be a model for the nation. i agree the democratic legislators and massachusetts might have given advice to republicans in congress on how to cooperate. we use the same advisers, and they say it is the same plan.

when the gov. romney talked about this a board for example, this unelected board that was created, this is a group of health care experts, doctors, to figure out how we can reduce the cost of care in the system over all. there are two ways of dealing with the health care crisis. one is to simply leave a whole lot of people uninsured and let them fend for themselves. let businesses figure out how long the bacon accept premiums until they just give up. we can figure out how we can make the cost of care more effective. there are ways of doing it. at a cleveland clinic, one of the best health care systems in the world, they actually provide great care cheaper than average. the reason they do is because they do some smart things. they say if a patient is coming in, let's get all the doctors

together at once into one test instead of having the patient run around with 10 tests. let's make sure we are providing preventive care so we are catching the onset of something like diabetes. the basisproviders on of performance as opposed to on the basis of how many procedures they engage in. what this board does is basically identify best practices. let's use the purchasing power of medicare and medicaid to help institutionalize all of the good things that we do. the fact of the matter is that when obamacare is fully implemented, we are going to be in a position to show that costs are going down. over the last two years, health care premiums have gone up -- it is true -- but they have gone up slower than any time in the last 50 years. we are already seeing progress.

people out there with insurance are already getting a rebate. governor mitt romney says we should replace it. we can replace it with something. he has not describe what exactly we would replace it with other than saying we will leave it to the states. the fact of the matter is, some of the prescriptions he has offered like letting me by insurance across state lines, there is no indication that will help somebody who has a pre- existing condition to be able to finally buy insurance. it is estimated that by repealing obamacare you are looking at 50 million people losing health insurance at a time it is vitally important. >> let's let the governor explain what you would do if obamacare is repealed. >> pre-existing conditions are covered under my plan. young people are able to stay on their family plan. that is already offered in the

private marketplace. you do not need the government -- government to mandate that. the key task we have in health care is to get the cost down so it is more affordable for families. he has a model for doing that, an unelected board who will decide what kind of treatment you ought to have a. in my opinion, the government is not effective in bringing down the cost of almost anything. as a matter of fact, free people and free enterprise is try to find a way to do things together are more effective at bringing down the cost that the government ever will be. your example of the cleveland clinic is exactly my point. this is the private market. these are enterprises competing with each other and learning how to do better jobs. i used to consult to hospitals and health-care providers.

i was astonished at the creativity and innovation that exists in the american people. in order to bring the cost of health care down, we do not need a board of the 15 people telling us what kind of treatments we should have. we should have insurance plans, hospitals, doctors on targets so that they have an incentive, performance pay for doing an excellent job for keeping costs down. that is happening. mayo clinic is doing it. the cleveland clinic and others. the right answer is not to have the federal government take over health care and start mandating to the providers across america telling a patient and a doctor what kind of treatment they can have. that is the wrong way to go. the private market and individual responsibility always works best. >> let me point out first of all this board we are talking about cannot make decisions about what treatments are given here that

is explicitly prohibited in the lot. let's go back to what gov. romney indicated. under his plan, he would be able to cover people with pre- existing conditions. actually governor, that is not what your plan does. your plan duplicates what is already the law. if you are on health insurance for three months, then you can end up getting continuous coverage. insurance company cannot deny you if it has been under 90 days. that is already the law. that does not help millions of people out there with pre- existing conditions. there is a reason why governor mitt romney said of the plan he did in the massachusetts. it was the largest expansion of private insurance. what it does say is insurers -- you have to take everybody. that also means -- when gov.

romney says he will replace it with something but cannot detail how it will be replaced -- and the reason he said of the system he did in massachusetts is because there is not a better way of dealing with pre-existing conditions. it just reminds me -- he says he will close deductions and loopholes for his tax plan. we do not know the details. he says that he is going to replace dodd-frank, wall street reform, but we do not know exactly which ones. he will not tell us. he now says he will replace obamacare and insurer as all the good things and it will be in there and you do not have to worry. at some point the american people have to ask themselves, is the reason gov. romney is keeping all of these plans to replace secret because they are too good? is it because somehow middle-

class families will benefit too much from them? the reason is because when we reform wall street, when we tackle the problem of pre- existing conditions, these are tough problems and we have to make choices. the choices we have made have been ones that ultimately benefited middle class families. >> i have to respond to that. my experience as a governor is that if i come in and lay down a piece of legislation and say it is my way or the highway, i do not get a lot done. what i do is the same way that tip o'neill and ronald reagan work together years ago. he laid out the principles that he was going to foster. he said he would lower tax rates. he said he was going to broaden the base. you said the same thing. those are my principles. i want to bring down the tax burden on middle income families. i will work together with congress to say what are the various ways we can bring down

deductions. one way will be to have a single number. make up a number -- $50,000. anybody can have deductions up to that amount. that number disappears for high income people. one could follow bowles simspn as a model. there are other ways to accomplish the objective that i have it. simplify the code, broaden the base, and create incentives for growth. with regards to health care, you obviously studied up on my plan. in fact, i do have a plan that deals with people with pre- existing conditions. what we did in massachusetts is a model for the nation state by state. i have said that at that time. the federal government taking over health care for the entire nation and it was king aside the 10th amendment that gives states the rights for these kind of things is not the course for america to have a stronger, more

vibrant economy. >> that is a terrific segue to our next segment -- the role of government. the role of government. give us your approach on this, mr. president. do you believe that the -- is there a fundamental difference between the two of you on how you viewed the mission of the federal government? >> i definitely think there are differences. the first role is to keep the american people safe. that is the most basic function. as commander in chief, that is something that i have worked on and thought about every single day i have been in the oval office. but i also believe that government has the capacity -- the federal government has the capacity to help open up

opportunity entry ladders of opportunity and to create frameworks' where the american people can succeed. the genius of america is the free enterprise and freedom and the fact that people can go out there and start a business, work on an idea, make their own decisions. as abraham lincoln understood, there are also some things we do better together. in the middle of the civil war, abraham lincoln said, let's help to finance the transcontinental railroad. let's start the national academy of sciences. grant colleges. we want to give these gateways of opportunities to all americans. if all americans are getting an opportunity, we will all be better off. that does not restrict freedom, that enhances it. what i have tried to do as president is to apply the same principles. when it comes to education, what

i have said is we have to reform schools that are not working. we do something called race to the top. we have said states -- we will give you more money if you initiate reforms. we have had 46 states who have made a real difference. what i have also said is, let's hire another 100,000 math and science teachers to make sure we maintain a technological lead and people are skilled and able to succeed. hard-pressed states right now cannot do that. we have seen layoffs of hundreds of thousands of teachers over the last several years. gov. romney does not think we need more teachers, i do. i think that is the kind of investment or the federal government can help. it can make a difference. as a consequence we will have a better trained work force, and that will create jobs because companies want to locate in places where there is a skilled workforce.

>> i love great schools. massachusetts, our schools are ranked no. one of 50 states. the key to grade schools, is great teachers. i reject the idea i do not believe in great teachers. every state should make that decision on their own. the role of government -- look behind us. the constitution and the declaration of independence. is to promote and protect the principles of those documents first. life and liberty -- we have a responsibility to protect the lives of people. i do not believe in cutting the military. i want to maintain the strength of the military. the line that says we are endowed by our creator with our rights -- we must maintain our commitment to religious tolerance and freedom in this country. it also says we are endowed by our creator with the right to pursue happiness as we choose. i interpret that as making sure

those people who are less fortunate and cannot care for a themselves are cared for by one another. we are a nation that believes we are all children of the same god and we care for those who have difficulties. those who are elderly, those who are disabled, we care for them. we look for discovery and innovation and all these things to pursue the pursuit of happiness for our citizens. we believe in maintaining for individuals the right to pursue their dreams. not to have the government substitute itself for the rights of free individuals. what we are seeing right now is in my view a trickle-down government approach which has government thinking they can do a better job every people pursuing their dreams. is not working. the proof of that is not everyone is and work here we have gone to 47 million people in food stamps. 50% of college graduates this

year cannot find work. we know the path regarding is not working. it is temper a new path. >> education. does the federal government have a responsibility for education? >> the primary responsibility is at the state and local level. i agree with arne duncan. some ideas he has put forward on race to the top. some of them i agree with and congratulate him on pursuing that. the federal government can get state and local schools. i wanted the kids who are getting federal dollars from title 1 -- disabled kids or lower income kids, i went and to be able to go to the kids at -- to the school of their choice. i would have them follow the

child and let the parent and child decide where to send their student. >> how do you see the federal government's responsibility to improve the quality of education? >> it has a significant role to play. we have worked with republican and democratic governors to initiate major reforms. they are having an impact right now. this is where budgets matter. budgets reflect choices. when gov. romney indicates that he wants to cut taxes and potentially benefit people like me and him, to pay for it we have to initiate significant cuts in federal support for education, that makes a difference. his running mate congressman ryan put forward a budget that

reflects many of the principles gov. romney has talked about. it was not very detailed. this seems to be a trend. what it did do -- if you extrapolate it how much money we are talking about, you are looking at cutting education by 20%. when it comes to community colleges, we are seeing great work done out there all over the country because we have the opportunity to train people for jobs that exist right now. one thing i suspect we probably agree on is getting businesses to work with community colleges. >> do you agree? >> let me finish my point. they are partnering -- they are designing training programs and people who are going through them know there is a job waiting for them if they complete it. there requires some federal support. let me say one final example.

when it comes to making college affordable, whether it is two- year or four-year, one thing i did is we were spending $60 million to banks and lenders as middlemen for the student loan program, even though they were guaranteed. there was no risk for the banks and lenders, but they were taking billions out of the system. why not cut out the middleman? we have been able to provide millions of more students assistance, lower or keep a low interest rates on student loans, this is an example of where our priorities make a difference. i genuinely believe gov. romney cares about education. when he tells a student that you should borrow money from your parents to go to college, that indicates the degree to which there may not be as much of a focus on the fact that folks like myself, folks like michele,

kids who probably attended the university of denver did not have that option. for us to make sure they have the opportunity and can walk through the door, that is vitally important not just to the kids, it is how we will grow the economy over the long term. >> we are running out of time. response to that. >>-- respnd to that. >> i have no plan to cut education funding and grants for people going to college. i am not planning on making changes there. you make a good point. the place you put your money makes it a clear indication on where your heart is. you put $90 million into green jobs. i am all in favor of green energy. that would have hired 2 million teachers. $90 billion. these businesses may have gone

out of business -- a number of them happen to be owned by people who are contributors to your campaigns. the right course for a merit oppose the government -- america's government is not to pick winners and losers, not taking over the health care system that has existed in this country for a long time and has produced the best health records in the world, the right answer is to say how do we make the private sector more efficient? how do we make schools more competitive? i suggest we grade our schools so parents can take their kid to a school that is more successful. i did not want to cut our commitment to education, i want to make it more efficient. i have had that experience. i do not just talking about it, i have been there. massachusetts schools are ranked no. 1 in the nation.

this is because i care about education for all of our kids. >> we barely have in three minutes left. i will not raid the two of you and say your answers have been too long. >> you have done a great job. >> the role of government and governing, we only have three minutes left before we go to the closing statements. i want to ask finally -- remember we have three minutes total time. many of the legislative functions of the federal government are in a state of paralysis as a result of partisan gridlock. if elected -- if reelected in your case, what will you do about that? >> i had a great experience of

being elected in a state where my legislator -- legislature was 87% democrat. that means we had to work together to get things done. we cut taxes -- >> what will you do as president? >> i will sit down on day one -- actually the day i get elected -- i will continue as we did in my state. we met every monday and talked about the challenges in our state in that case. we have to work on a collaborative basis, not because we will compromise our principles, but because there is common ground. the reason i am in this race is because there are people hurting. we face this deficit that could crush future generations. there are developments a round the world that are of real concern. republicans and democrats both loved america, but we need to

have leadership in washington that will bring people together and get the job done and could not care less if it is a republican or democrat. i have done it before, and i will do it again. >> i think gov. romney will have a busy first day because he is going to repeal obamacare which will not be popular among democrats if you are sitting down with them. my philosophy has been, i will take ideas from anybody as long as they are advancing the cause of making middle-class families stronger and giving ladders of opportunity. that is how we cut off -- that is how we cut taxes for the middle-class. that is how we cut spending that was not advancing the cause. that is how we signed a free- trade agreements into law. that is how we repealed don't ask don't tell.l that is how we ended the war in iraq, and that is how we will

wind down the war in afghanistan. we have seen progress even under republican control of the house of representatives. part of being principled and part of being a leader is being able to describe exactly what it is you intend to do, not just saying "i'll sit down." occasionally you have to say no to people both in your own party and in the other party. yes, have we had some fights between me and the republicans when they fought against us reining in the excess against wall street? absolutely. that was a fight that needed to be had. about whether americans had more security with their health insurance, that was a fight we needed to have. part of leadership and governing is both saying what it is you are for and also being able to say no to some things.

when it comes to his own party in the course of this campaign, he has not displayed the willingness to say no to some of the more extreme parts of his party. >> that brings us to closing statements. gov. romney, you elected to go last. you have two minutes, mr. president. >> i want to thank you, and i want to thank gov. romney because this was a terrific debate. i want to thank the university of denver. four years ago we were going through a major crisis. yet, my faith in the american future is undiminished. the reason is because of its people. because of a woman i met in north carolina who decided at 55 to go back to school because she wanted to inspire her daughter and now she has a new job. because of a company in

minnesota willing to give up salaries and perks for the executives to make sure they did not lay off workers during a recession. the auto workers that you need in toledo or detroit take such pride in building the best cars in the world not just because of a paycheck, but because it gives them a sense of pride that they are helping to build america. the question now is how do we build on the strengths? everything i have tried to do everything i am proposing for the next four years as far as improving education or developing american energy or making sure we are closing loopholes for companies shipping jobs overseas and focusing on small businesses create jobs in the united states, or closing deficit in a responsible way for a lot of us to invest in the future, all of those things are designed to make sure that the american people, their genius, their determination is channeled and they have an opportunity to